WASHINGTON, Dec 23 (Reuters) - The US Federal Reserve announced on Monday that it plans to make significant changes to its annual "stress test" of large banks in a bid to make them more transparent and less predictable.
The changes under consideration include making public the models the Fed uses to determine the hypothetical losses banks would face under the exam, as well as welcoming public comment on them.
The Fed would similarly welcome feedback on the hypothetical scenarios it creates each year for the exam, and also average results over two years to reduce annual volatility in the results, which determine how much extra capital firms must set aside for potential losses.
The Fed said the proposed changes were not designed to affect overall capital requirements.
Reporting by Pete Schroeder; Editing by Mark Porter
